Thank you for the Tax free savings account in the 2008 budget!
But there is still a problem!  In fact this budget made it worse for some.

Low income seniors withdrawing money from RRSP lose ­a half of their savings to GIS claw back. Low income seniors who don’t use the RRSP program don’t lose their savings. Is that fair?

Please stop enticing vulnerable seniors into this trap by baiting them with a tax refund.

Either change the GIS claw-back system on tax returns to solve the problem, or make sellers of RRSPs responsible since they should have used better judgement while selling the RRSPs. Also as the people’s government, please assume responsibility and ­pay back unfairly collected monies to our lowest income senior citizens.

NOTE: The $3,500 allowable income without affecting the senior’s GIS appears to compound the problem. Seniors affected would have about $3,500 of CPP income anyway. This opens the jaws wider so the government can gobble up more of their RRSPs.

If seniors decide to collapse their total RRSPS in one year to avoid claw-backs in subsequent years, the RRSP withdrawals that exceed the upper limit will now be clawed back on an extra $3,000 at the top end. That’s an additional $1,500.00 out of their pockets!

Please correct this now.  Thank you

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PS Please inform the people at www.GordonHughes.ca as soon as specific action has been taken to solve this problem so we can close down this web page. Thank you.